Flipkart aims to begin trading refurbished handsets by Diwali. The Indian e-commerce giant will take this move following the footsteps of Amazon, its U.S. rival, in India. Flipkart the trading of smartphones will be prompted by the high smartphone return rates and the absence of a costing advantage with the roll out of the Goods and Services Tax. This data was given by two senior industry executives having a deep knowledge of this matter.
Flipkart-certified refurbished smartphones will be traded on the offline retail stores and online marketplace, for which meetings have been conducted with merchants. Flipkart will utilize Ekart, its logistics arm, for deliveries.
“Although Flipkart has of late tightened return policies on smartphones and only permits replacement if there is a defect, it is already burdened with lot of inventory return,” claimed one of the executives mentioned above held meetings with Flipkart for online distribution to the media. “There are also smartphones with slight issues that are replaced. The company aims to get them verified and certified to work and look like new and trade them as refurbished smartphones certified by Flipkart. There will be restricted warranty on such goods as well.” Three segments of refurbished smartphones will be provided, priced at 60% to 75% of their usual value, the other executive claimed. “The refurbished market in the country is frequently unorganized and Flipkart wishes to construct it,” he further claimed. Flipkart refused to speak on the matter.
The firm aims to trade well-liked brands such as Motorola, Lenovo, Panasonic, Samsung’s “On Series,” Sony Xperia, and Micromax among others. Amazon started offline distribution of handsets previously this year and also began trading certified refurbished smartphones. It presently trades Coolpad handsets and aims to extend it to other smartphones of brands such as Motorola and Samsung.
Industry executives claimed that Flipkart and Amazon are making an entry in the offline sales to provide a broader distribution platform to smartphone merchants, comprising various new Chinese firms. In addition to this, Goods and Service Tax on handsets has been set at a consistent 12%, restoring varying rates of value added charges taxed by states.